S&P 500 and Nasdaq under pressure from global events

S&P 500 chart analysis

Monday was very bad for the S&P 500 index, as we saw a drop to the 5090.6 level. A strong bullish trend caused the index to lose 4.40% of its value. Instability in the Middle East caused a sell-off in stocks, which brought down the S&P 500. After that, the index stabilized and started a recovery to the 5250.0 level. During this morning’s Asian session, the recovery continued to 5275.0.

We encountered the EMA 50 moving average there, which does not allow us to move above it for now. The S&P 500 is forced to initiate another bearish consolidation, and we are now on the verge of reaching 5200.0. Potential lower targets are 5150.0 and 5100.0 levels. For a bullish option, we need a positive consolidation and return to the zone around 5300.0. There, we get support from the EMA 50 moving average to continue on the bullish side. Potential higher targets are 5350.0 and 5400.0 levels.

Nasdaq chart analysis

On Monday morning, the Nasdaq index retreated to the 17235.0 level, losing 11.9% of its value in just three trading days. After forming a new low, we stopped further pullback, and a recovery to the 18000.0 level was initiated. Bullish momentum took us up to the 18310.0 level this morning, where we formed a new high. The index lost momentum in that zone and initiated a pullback to the 18000.0 level.

This level could be decisive for the Nasdaq’s longer-term trend. An impulse above 18400.0 would bring us back to the positive side above the weekly open price. Potential higher targets are the 18600.0 and 18800.0 levels. The EMA 200 moving average provides additional resistance to the index in the 18800.0 zone. We cannot reject the bearish option if the index falls below last night’s low, 17800.0.

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